Don't contract with Menards

and that's why they don't have their own truck with a paid driver. It's too easy to suck in somebody to buy their truck and work for free.

 

What has Menards got against using a flatbed and a Moffett?

 

I just read an ad today on craigslist of Menards wanting an O/O delivery driver:

http://chicago.craigslist.org/wcl/trp/3600988242.html

"Menards DOES all the behind the scenes work for your business from Advertising your Service, Selling your Service to our guests, Scheduling and Coordinationg All the paperwork, pulling all the materials, and loading them on your truck and working with you on your invoicing. All you have to do is deliver the materials out and provide Great Guest Service!"

Yeah, kinda sounds like a 'Fleece- Purchase' arrangement. I have found that in the transportation-driver industries (trucking, taxi, messenger/courier, etc), companies apparently are allowed to 1099 drivers because said companies can seemingly abide by the majority of the IRS requirements for treating one as a contractor.

http://www.irs.gov/Businesses/Small-Businesses-&-Self-Employed/Behavioral-Control
http://www.irs.gov/Businesses/Small-Businesses-&-Self-Employed/Financial-Control
http://www.irs.gov/Businesses/Small-Businesses-&-Self-Employed/Type-of-Relationship


The biggest keys, I believe, which allow Menards to get away with 1099'ing are:

- the driver has a significant investment (purchasing the truck)
- has the opportunity for profit and the risk of loss
- payment is 'by the load' and not hourly


However--I do believe that the delivery services are 'ongoing' , thus likely forming a 'permanency relationship'. I further believe that the delivery of materials should be considered 'a key part of their business' as any sales should be for a retailer. Therefore, these last two points would indicate that the relationship is more of an employer/employee one....I am just analyzing...


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In this instant case, I would have added a clause in the contract with Menards that would pay me a 'floor' for each seven calendar days for five years--absolutely necessary so that I may recover the all the fixed costs of the truck purchase contract.

Not knowing the operating costs to run the truck in the picture above, I cannot use the likely operating cost numbers. Let me just state that I would require, as a 'floor' or 'guarantee', the average daily amortization of all truck payments, all licenses/plates/city stickers, and all related insurances plus ten gallons of fuel (based on gallons to cover me with fluctuating prices), plus another $100 for myself.

An OTR example: I calculated on a spreadsheet that a $50k tractor (no trailer) financed at 12% for three years put on with Progressive's Commercial Bob Tail Insurance, $3.6k Power Plate, and $1.2k worth of IFTAs to about $6.4k per annum, or roughly $533 per month, or approximately $73 per day. Now we can see financially why O/Os do not like sitting for days waiting on a load. Finally, #1 diesel is currently $4.10/gal in my area.

Doing the math, I would require Menards or any local outfit to guarantee me $73x7 + $4.10x10x7 + $100 or $1,498 every seven days for my $50k tractor. Now, lets say the Menards truck is half the cost of this $50k tractor workup.

Then, if Menards cannot shell out $700 as a floor (not as a bonus) to cover my fixed expenses, meaning I get this whether the truck is started that week or not, then I don't sign the contract. Do lawyers just stand by for free when you want them on a whim? I think not---it is called a 'retainer'--and it has a price floor usually around $2k.

I have driven taxis, my own vehicles as a courier/messenger to include a route with a cargo van, floral delivery, pizza delivery, and a Straight Truck 'On-Demand', and I decree: Any 'local' driving work in the Northeastern Part of Illinois or Northwestern Part of Indiana not paid by either the hour or a floor-guarantee percentage is a money loser.

 

Well, if you're an independent contractor, aren't you free to use your truck elsewhere? They want me to deliver a cheap load for them, I'll tell them that Lowe's has a more profitable load for me to deliver right now, and I'll get to them when I can - unless they want to up their bid.

 

My understanding is: If one wants to drive a commercial vehicle for hire for one's own freight i.e. direct from the shipper, one needs to get an operating authority and commercial insurances in order not to be in violation. In Illinois, if you ONLY pick-up and deliver in Illinois, you only need ICC numbers. If one crosses state lines, then one needs the DOT MCC numbers--and neither set of numbers nor the commercial insurances come cheap.

Indeed--especially since the truck would be yours. However, Menards likely will de-facto own you by making a workday full of crap so that you will not have time to go anywhere else. Alternatively, they just may 'can' you because you would be driving for their competition as some courier companies I drove for did to me when I attempted to exercise my right as an Independent Contractor.

 

I didn't look closely at the truck; is it over 26000 GVWR?